The apparently copy-cat attacks that caused traffic chaos but killed no one on Thursday came two weeks after bombers killed 52 commuters in the British capital.
The two men were held after raids late on Friday in the Stockwell area of south London close to the site of one of Thursday's failed bombs on three underground trains and a bus - the same targets as the 7 July bombs.
The arrests took place hours after police chased and shot dead another man in front of shocked passengers in the packed Stockwell Underground train station.
Police released closed circuit television pictures of the four suspects and appealed for the public to help find them but warned that they were dangerous and not to be approached.
Less than 24 hours after the pictures were released, police said they had received more than 400 calls from the public.
The killing of a suspect - shot five times at close range in the train - took Britain's fight against terrorism to a new level of force in a country where only specialist officers carry weapons and killings by police are rare.
It sparked a fierce debate over whether police were right to adopt an apparent shoot-to-kill policy.
The shoot-to-kill policy risks the
lives of innocents, say critics
The Islamic Human Rights Commission (IHRC) and anti-war campaigners condemned the shooting as the start of a dangerous new chapter, but police and London's mayor defended it.
"IHRC fears that innocent people may lose their lives due to the new 'shoot to kill' policy of the Metropolitan Police," chairman Massoud Shadjareh said in a statement.
Mayor Ken Livingstone said the duty of the police was to protect the public against people considered terrorist suspects, and police said they had followed the man they shot from a house under surveillance and who had run when challenged.
The Independent Police Complaints Commission said it was investigating the killing, as it did all fatal police shootings.
Media said police were operating under secret new guidelines, codenamed Operation Kratos, allowing them to aim for the head if they believe there was a threat to the public.
Police were sent to a series of security alerts.
Details of the manhunt dominated British TV bulletins, while newspapers splashed the suspects' pictures beneath the words "The Four Most Wanted", "The Fugitives" and "Human Bombs".
Witnesses told of plain-clothes police pursuing a suspect on to a subway train carriage. He slipped as he ran and then was repeatedly shot at point-blank range as he lay on the floor.
London's police chief Ian Blair said on Friday that his force faced "the greatest operational challenge" in its history.
Police declined to say whether the men in custody or the man shot dead were among the four suspects pictured in the photographs.
The attacks on 7 July killed 52
people and injured 700 others
But the Sun tabloid said the first man arrested on Friday was suspected of trying to blow up the bus in Thursday's attempted bombings.
The Abu Hafs al-Masri Brigade, a group linked to al-Qaida, has claimed responsibility for Thursday's bombings and those of 7 July and has threatened to target Italy, Denmark and the Netherlands, which also have troops in Iraq.
However, the group's claims of responsibility for previous attacks in Europe have been discredited by security experts.
Police briefly closed Mile End Underground station in east London on Saturday in a security alert but declined to comment on speculation it was over the mistaken sighting of one of the suspected bombers. They said no one had been arrested.
The 7 July attacks killed 52 people and injured 700 in the worst peacetime attacks in the city's history. But on Thursday the bombs failed to go off properly and no one was killed.
Because of that, police have more clues, including the unexploded bombs, eyewitness reports and CCTV footage.